Obama signs waste crackdown

President Barack Obama signed a bill Thursday that will help the government recover billions of dollars in extravagant, ineffective federal spending. His objective: Reduce these improper payments by $50 billion by 2012.

"We have to challenge a status quo that accepts billions of dollars in waste as the cost of doing business," the president said.

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Yet that objective would only halve the roughly $110 billion in improper payments agencies made in the past fiscal year — the highest amount to date.

The new law, sponsored by Sen. Tom Carper (D-Del.) and Rep. Patrick Murphy (D-Pa.), would require agencies to conduct additional audits looking for payments that were made in error as well as fraudulent claims. Agencies will do annual risk assessments and use recovered funds to improve their fiscal management. Unlike today, if an agency doesn’t follow the law, there will be repercussions.

The premise, Obama said, is simple: Waste not, want not. Dollars lost through waste and fraud, he said, are dollars that could have been spent on education, student loans and government debt.

"When we continue as if deficits don't matter, that means our kids and our grandkids may wind up saddled with debts that they may never be able to repay," said Obama, speaking in the White House State Dining Room.

The president also reminded the crowd that the both the House and the Senate unanimously passed the bill. “A powerful reminder of what we can accomplish when we put partisanship aside and do what’s best for the people we serve,” he said.

Since coming into office, Obama said, his administration has worked to be a more responsible steward for America tax dollars, combining, as he put it, “21st-century technology and old-fashioned common sense.” Obama has proposed a three-year freeze on all nonsecurity discretionary spending in his budget, and last month, he created a "’Do Not Pay’ List," a federal database that agencies must check before paying contractors.

Obama told the audience that his administration cut an outdated $35 million plan for ships' radio navigation, "since we now have this thing called GPS." He also questioned the need for a revamped Homeland Security logo and new presidential helicopter fleet. “Marine One is fine," he said.

The president added, "We froze salaries for senior White House staff — hence the glum faces."

Obama said his pick to be the new Office of Management and Budget director, Jacob Lew, will be trusted with "building on the good work” that the outgoing budget chief Peter Orszag began.